Practical analysis for investment professionals
11 December 2013

Top 10 Things Peeving Cliff Asness (Podcast)

Posted In: Drivers of Value

Clifford S. Asness, managing and founding principal at AQR Capital Management, is bothered by some prevailing beliefs in the investment industry. In particular, he feels that many popular ideas are wrong or misleading and thus could harm investors. In his Perspectives article in the January/February 2014 issue of the Financial Analysts Journal, he decided to “take a machine-gun approach and talk about 10 things” that were on his mind.

Asness discussed his peeves with Rodney N. Sullivan, CFA, head of publications at CFA Institute and editor of the FAJ, in the following interview.

Asness says that he’s annoyed by the frequent use of the word “bubble,” which he feels is often misapplied. “I think we’ve gone from being maybe properly reticent to use that word to being way too willing to use that word,” he says. “‘Bubble’ has gone from being an extreme situation that should be very rare to meaning something that we think is a bit expensive, something that we would underweight, something that we would short.”

He also discusses his opinions regarding media coverage of US equity markets and the potential for sensationalism. “‘Have reasonable expectations’ is not a great story,” he says. “‘Stocks are super cheap’ or ‘We’re in a bubble; get out’ is a great story.”

“I like clarity and honesty,” Asness says, calling for the investment industry and the financial media to use more accurate and clearer language.

To hear Asness discuss these issues and others — including smart beta, holding bonds, and cash on the “sidelines” — listen to the complete interview above or download the MP3.

You can also access the full article on the CFA Institute Publications website.

Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

About the Author(s)
Abby Farson Pratt

Abby Farson Pratt was an assistant editor at CFA Institute. Previously, she worked at the Denver Post and the University of North Carolina Press. Pratt earned the Claritas™ Investment Certificate and holds a BA in journalism and English from the University of North Carolina at Chapel Hill.

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